How digital payments can change the lives of women in Ethiopia’s coffee industry

Agriculture accounts for over a third of Ethiopia’s economy — and women make up 75% of the sector’s labour force. They are the backbone of Ethiopia’s agricultural sector, playing a crucial role in both food security and national economic stability.

The livelihoods of an estimated 15 million Ethiopians depend on coffee production. Despite their vital role, research reveals a substantial gender income gap, with women only receiving an estimated 34% of the income generated from coffee. This disparity stems from several factors, including limited access to land, credit and market opportunities.

Digitizing agricultural payments offers a powerful path to financial inclusion, smoother transactions and greater transparency. However, achieving this vision requires tackling obstacles like limited phone ownership, digital literacy gaps, connectivity issues in remote areas and the lack of appropriate financial tools for farmers.

Sara Yirga, President of the Ethiopia Chapter of the International Women’s Coffee Alliance, (IWCA) said: “It's going to take a little more effort to integrate women into the digital payment landscape. We need a comprehensive approach beyond education and awareness campaigns. Addressing the underlying barriers that hinder their adoption is crucial to ensure the seamless transition into the digital financial ecosystem.”

Established in 2016, the Ethiopia Chapter of the IWCA is dedicated to supporting women in the coffee sector. The organization aims to tackle the structural barriers that prevent women farmers from fully realizing the benefits of their participation in one of Ethiopia’s leading exports. Digital payments offer a solution to challenges in accessing markets and securing fair compensation. They do so by providing transparent transaction trails, facilitating tracking, ensuring fair compensation and preventing fraud in the supply chain.

By embracing digital payments, Sara has streamlined her business operations: “For my workers, salaries directly go to their bank accounts, preventing unnecessary spending. The shift to digital not only eases their lives but also reinforces mindful spending.”

These efforts are backed by an evolving policy environment. Ethiopia's National Digital Payments Strategy (NDPS), a key driver towards achieving Digital Ethiopia by 2025, emphasizes responsible digitization. It has made significant progress in bridging the gender divide, focusing on improving efficiency, transparency, women’s economic participation, financial inclusion and overall inclusive growth. The inaugural strategy was developed with the United Nations-based Better Than Cash Alliance Secretariat in 2021.

Digital financial services, particularly mobile money, have played a crucial role in enhancing financial inclusion. In the fiscal year 2022/23, Ethiopia’s mobile money service, "telebirr," reported attracting 34.3 million subscribers with a total transaction value of $12.3 billion.

The Reaching Financial Equality for Women action plan emphasizes the importance of financial inclusion as a foundation for women’s economic empowerment. It outlines steps that can be taken to end economic exclusion of women by tailoring policies and programmes to address the specific barriers women face in accessing financial services. This, in return, will enable them to invest in expanding their businesses and improving their livelihoods.

Digital payments can foster a more equitable agricultural landscape by enabling women to enhance productivity, improve quality, expand their market reach and adopt sustainable practices.

Sara emphasizes the transformative power of digital payments: “Digital payments may take time to understand, but for women in agribusiness, having access to their money gives them control over their finances. Research shows that women receive only 34% of the resources after a year of hard work. With their own portion of money, women can decide how to spend or save, giving them a voice and control over their financial choices," she added.

Sara’s message is clear: “Digital is safe, digital is fast and digital is the way forward”.

As Ethiopia moves towards a digital future, digitizing payments in the coffee industry will not only provide women with the tools to shape their financial futures, but also contribute to the overall economic prosperity of the nation.

Sara Yirga’s experience exemplifies the positive outcomes of embracing digital payments, emphasizing its pivotal role in shaping a more inclusive and equitable future for women in the coffee sector.